Low Cost Carrier WOW Air Goes Bankrupt Leaving Thousands Stranded

WOW Air, the Icelandic low-cost carrier, is bankrupt. The news follows a failed acquisition by Indigo Partners, in addition to failed talks with full-service rival Icelandair. WOW has been facing financial difficulties for around five months now. In fact, the CEO of the company had to use his own money to prop it up at one point.

The last year has seen a number of high profile airline collapses, mostly driven by rising fuel prices and unfavourable exchange rates. They have been unable to compete in a market where ticket price is everything. At the start of October, we saw the bankruptcy of Primera Air.

Additionally, at the end of November when the Icelandair deal collapsed, WOW CEO Skúli Mogensen was forced to take action. While he injected €5.5 million of his own money into the airline, this, unfortunately, wasn’t enough to keep the airline in business. At the time he blamed the following on poor financial health:

Two failed acquisitions

There have been two failed acquisitions of WOW Air. The first, by Icelandair, fell through as WOW Air was not able to meet criteria set out prior to a shareholders meeting. However, almost immediately afterwards talks began with airline investment firm Indigo Partners. These talks came to an end last week. While things looked bleak, there was a glimmer of hope as Icelandair showed renewed interest in WOW, however, on Sunday it was confirmed that a deal would not happen.

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What if I have flights booked?

Firstly, if you have flights booked with WOW Air, do not to head to the airport. Your flight will not take place as the airline has suspended all operations. WOW Air has told passengers to “check available flights with other airlines.” While also mentioning “Some airlines may offer flights at a reduced rate, so-called rescue fares, in light of the circumstances. Information on those airlines will be published, when it becomes available.”

CEO Skúli Mogensen was previously required to inject his own money into the airline. Photo: WOW Air

Passengers are advised to contact their credit card issuer to see whether they may be able to get a refund on the flight tickets. Additionally, if flights are part of a package tour, they may be protected. Passengers in this circumstance are advised to contact their travel agent or tour operator.

Finally, some travel insurance packages have clauses for airline insolvency. If you have travel insurance booked for your trip, or an annual travel insurance plan, you should check to see whether you are protected in the case of airline bankruptcy. If this is the case, be sure to contact your insurance provider who will detail the next steps.

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Have you been affected by the suspension of WOW Air flights? Let us know your story in the comments down below!

Content Manager – Degree educated in Aerospace Technology, this certified pilot is a passionate specialist in European aviation. Working closely with British Airways, Lufthansa and others, Tom provides commentary on topical issues for outlets including the BBC. Based in Frankfurt, Germany.